One in five backs government action on superannuation boardrooms: poll

Heath Aston

The Coalition is pushing ahead with plans to reduce union influence over the $2 trillion superannuation sector despite research suggesting little community support – and a lack of understanding – for the proposed changes.

A bill that will force industry superannuation funds to reconfigure their boards with at least one-third independent directors and an independent chairperson is due to be debated in the House of Representatives on Monday.

The proposed reforms are supported by the big banks but bitterly opposed by industry funds, which say their not-for-profit model has consistently delivered superior returns to members when compared with commercial funds.

A poll of 1000 people, conducted on behalf of Industry Super Australia by Essential Media Communications, found just one in five people agreed that industry funds should be "more like the for-profit bank super funds".

But almost half the respondents had no preference or were unsure, suggesting little community awareness of the issue.

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Set against the backdrop of the trade union royal commission, the poll revealed a distinct lack of trust in banks.

More than twice the number of respondents – 43 per cent – said industry funds deliver better returns than bank-managed funds.

The financial industry has pushed for fewer industry and union representatives on super funds. In his second-reading speech last month, former assistant treasurer Josh Frydenberg said the government's objective was having the "best people governing the retirement savings of Australians".

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Unions view the proposed changes as an ideological exercise, part of the Coalition's battle against union leaders, while industry fund leaders believe the main motivation is one of "disruption" designed to deliver the banks a larger slice of the vast retirement wealth sector.

In a surprise move last week, the Governance Institute reversed its previous support, urging the Turnbull government to abandon the legislation, which it described as "over-politicised".

ISA chairman Peter Collins – a former NSW treasurer and doyenne of the Liberal Party – had urged Malcolm Turnbull to rethink the legislation but Assistant Treasurer Kelly O'Dwyer said the bill was "measured and balanced" and would proceed.

ISA chief executive David Whiteley said the polling proved the "crash-through" approach taken by the government was at odds with any community concern about super fund governance.

"This model of governance has delivered better returns for people and those who engage in this area appear to understand that. The banks have a serious challenge in regaining the trust of the community," he said.

"Employers and unions have worked together to deliver members superior retirement savings. The only opposition to industry super and other not-for-profit super funds comes from the banks and their lobbyists."

The poll found 54 per cent of people agreed that having union and employer representatives on super boards helps ensure funds are run with the best interests of their members at heart

"This research demonstrates that many Australians feel it is important that the voice of members is represented around the board table of their super fund, via employers and unions who have direct knowledge or expertise of the workplaces and industries of contributing members," Mr Whiteley said.